williambanzai7

Kicking People Out - Cramer's Stop Trading! (9/24/08)

Bush Bailout Rising
(to the melody of Bad Moon Rising
Creedance Clearwater Revival)
Adapted by WilliamBanzai7)

I see a a Bush Bailout arising.
I see trouble on the way.
I see fiscal earthquakes and lightnin.
I see bad economic times today.

Chorus:
Dont listen to Hank n Ben tonight,
Well, its bound to take your net worth's life,
There's a bailout on the rise.

I hear deficit hurricanes a blowing.
I know the end is coming soon.
I fear rivers of debt over flowing.
I hear the taxpayer voice of rage and ruin.

Chorus
Dont listen to Hank n Ben tonight,
Well, its bound to take your net worths life,
There's a bailout on the rise.

Hope you got your assets n things together.
Hope you are quite prepared to die.
Looks like were in for nasty market weather.
One eye is taken for an eye.

Where's the Bottom? Still Anybody's Guess

TO BAIL OR NOT TO BAIL
(Adapted from William Shakespeare's Hamlet)
(WilliamBanzai7)

To Bail, or not to Bail, that is the question:
Whether 'tis nobler in the mind to suffer
The slings and arrows of outrageous loss of fortune,
Or to take arms against a sea of financial troubles
And by opposing end them. To die—to sleep,
No more; and by a sleep to say we end
The heart-ache and the billion market shocks
That investor hubris is heir to: 'tis a consummation
Devoutly to be wish'd. To die, to sleep;
To sleep, perchance to dream—ay, there's the rub:
For in that sleep of death what dreams may come,
When we have shuffled off this market coil,
Must give us pause—there's the respect
That makes calamity of so long life.
For who would bear the whips and scorns of time,
The CEO banker's wrong, the proud man's contumely,
The pangs of write offs, the law's delay,
The insolence of office, and the spurns
That patient merit of th'unworthy takes,
When he himself might his quietus make
With a bare quill? Who would Federal oversight bear,
To grunt and sweat under an ordinary life,
But that the dread of something after death,
The undiscovere'd country, from whose bourn
No traveller returns, puzzles the will,
And makes us rather bear those ills we have
Than fly to others that we know not of?
Thus conscience does make cowards of us all,
And thus the familiar hue of resolution trust
Is sicklied o'er with the pale cast of thought,
And enterprises of great pitch and moment
With this regard their currents turn awry
And lose the name of action.

Paulson/Bernanke: $700 Billion at 'Hold to Maturity' Pricing

DRAFT NO. 1
U.S. Treasury
Office of Sekretary Henry (Hank) Paulson

LEGISLATIVE PROPOSAL FOR TREASURY AUTHORITY
TO PURCHASE TOXIC FINANCIAL ASSETS

Sec. 1. Short Title.

This Act may be cited as "Taxpayer networth annihilation and Investment banking wealth Recovery Plan" ("TwIRP") .

Sec. 2. Purchases of Toxic Assets.

(a) Authority to Purchase. – The Sekretary is authorized to purchase, and to make and fund commitments to purchase, on such terms and conditions as determined by the Sekretary in his sole, absolute, divine and knowing discretion, any and all manner of Toxic Assets from any Financial Institution, as those terms are defined in section 13 of the Act.

(b) Necessary Actions. – The Sekretary is authorized to take such actions as the Sekretary deems necessary to carry out the authorities in this Act, including, without limitation:

(1) appointing such employees and hiring konsultants (da Konsultanz with a K), unemployed investment bankers and advisors as may be required to carry out the authorities in this Act and defining their duties;

(2) entering into contracts, MOUs, LOIs, including lucrative contracts for investment banking and financial advisory services for the management of Toxic Assets;

(3) designating Financial Institutions as financial agents, revenue collectors, purchasing agents and proxies of the Government, and they shall perform all such reasonable duties related to this Act as financial agents and proxies of the Government as they deem fit in their sole and absolute discretion;

(4) establishing vehicles, including offshore SPIVs and conduits, pyramids and highly leveraged PONZI structures that are authorized, subject to new ideas by the Secretaries quantitative engineer, to purchase Toxic Assets and issue open ended obligations;

(5) directly and indirectly, granting bonuses, equity kickers, management fees, performance fees, restructuring fees, brokerage commissions, finders fees, entertainment accounts, unemployment compensation and other compensation arrangements; and

(5) formulating such regulations, fine print, boilerplate, standard terms, ISDA riders and other terms as may be necessary or appropriate to define terms or carry out the authorities of this Act.

Sec. 3. Considerations.

In exercising the authorities granted in this Act, the Sekretary shall take into consideration means for –

(1) Reinstating Wall Street investment bankers into the financial pecking order of society;

(2) shafting the taxpayers; and

(3) appropriate steps to paper over any conflicts of interest in the hiring of Wall Street contractors or advisors. Any regulation issued under this authority shall not be subject to the rest of the United States Code.

Only to the extent reasonably feasible, the Secretary shall attempt to provide stability or prevent corruption in the financial markets or banking system;

Sec. 4. Reports to Congress.

Within three months of the first exercise of the authority granted in section 2(a), and semiannually thereafter, the Sekretary shall only if feasible, attempt to report to the Committees on the Budget, Financial Services, and Ways and Means of the House of Representatives and the Committees on the Budget, Finance, and Banking, Housing, and Urban Affairs of the Senate with respect to the authorities exercised under this Act and the considerations required by section 3.

Sec. 5. Rights; Management; Sale of Troubled Assets.

(a) Exercise of Rights. – The Secretary may, at any time, in his sole, absulute, reasonable or unreasonable, divinely inspired discretion, exercise any rights received in connection with Toxic Assets purchased under this Act.

(b) Management of Toxic Assets. – The Secretary shall have authority to manage, securitize and repackage Toxic Assets purchased under this Act, including conjuring revenues and engineering away all portfolio risks therefrom.

(c) Sale of Toxic Assets. – The Sekretary may, at any time, any place, to anyone, upon terms and conditions and at prices determined by the Secretary in his sole and absolute divine discretion, sell, or enter into securitiised loans, CDOs, CDSs, kickers, participations, synthetic securities, repurchase transactions, black holes or other financial weapons of mass destruction in regard to, any asset purchased under this Act.

(d) Application of Sunset to Toxic Assets. – The authority of the Sekretary to hold any Toxic mortgage-related asset purchased under this Act before the termination date in section 9, or to purchase or fund the purchase of a mortgage-related asset under a commitment entered into before the termination date in section 9, is not subject to the provisions of section 9.

Sec. 6. Maximum Amount of Authorized Purchases.

The Sekretary's authority to purchase Troubled Assets under this Act shall be unlimited, but for optical puroses shall be expressed as $700,000,000,000,000,0... outstanding at any one time.

Sec. 7. Funding.

For the purpose of the authorities granted in this Act, and for the costs of administering those authorities, the Sekretary may use the proceeds of the sale of any securities issued under chapter 31 of title 31, United States Code, and the purposes for which securities may be issued under chapter 31 of title 31, United States Code, are extended to include actions authorized by this Act, including the payment of administrative expenses. Any funds expended for actions authorized by this Act, including the payment of administrative expenses, shall be deemed appropriated at the time of such expenditure.

Sec. 8. Review.

Decisions by the Secretary pursuant to the authority of this Act are absolutely non-reviewable and committed to absolute agency discretion, and may not be reviewed by any court of law, any administrative agency, any Congressional Committee, media, newspaper or press or other divine authority.

Sec. 9. Termination of Authority.

The authorities under this Act, with the exception of authorities granted in sections 2(b)(5), 5 and 7, shall be in perpetuity.

Sec. 10. Increase in Statutory Limit on the Public Debt.

Subsection (b) of section 3101 of title 31, United States Code, is amended by striking out the dollar limitation contained in such subsection and inserting in lieu thereof "such amount as is determined under Section 6.

Sec. 11. Credit Reform.

The costs of purchases of Troubled Assets made under section 2(a) of this Act shall be determined only if feasible and if we have more time.

Sec. 12. Indemnification and Release.

No consultant, agent, employee or other firm engaged pursuant to this Act shall be held accountable for negligence or shabby performance, including in particular, service and performance
in a grossly negligent and reckless manner. Such parties shall be fully indemnified with the full faith and credit of the USA.

Section 13. Definitions.

For purposes of this Act, the following definitions shall apply:

(1) Financial Institution. – The term "Financial Institutions" means any institution including, but not limited to, banks, thrifts, credit unions, broker-dealers, and insurance companies, having significant operations in the United States; and, upon the Sekretary's determination perhaps in consultation with the Chairman of the Board of Governors of the Federal Reserve, any other institution he determines necessary to promote financial market stability. For the avoidance of doubt, the term shall include Goldman Sachs, Morgan Stanley and any spin off, successor or surviving entity.

(2) Secretary. – The term "Sekretary" means the "Hank" Paulson and his heirs and or Phil Gramm.

(3) Toxic Assets. – The term "Toxic Assets" means residential or commercial mortgages and any securities, obligations, or other instruments that are based on or related to such mortgages, that in each case was originated or issued on or before September 17, 2008; and, upon the determination of the Sekretary perhaps in consultation with the Chairman of the Board of Governors of the Federal Reserve, any other financial WMD, as he determines necessary to promote the strength of Wall Street; including without limitation, leveraged buyout credits, prime brokerage margin credits and and all CDS counter party liability.

(4) Black Scholes Formula.-- A term utilized to convince the cynics and skeptics that we know what we are doing.

(5) LTCM. A previous financial disaster that would have led to financial meltdown. Discounted by the regulatory authorities as a 1000 year aberation.

(6) Alan Greenspan. A once in a 1000 year goofball.

(7) George Bush. A circus clown who lives in the White House.

(8) SEC. Somebody please Eject Cox.

(9) 2 Big 2 Fail. 2 Stupid 2 Survive.

(8) United States. – The term "United States and USA" means the United Socialistic American States, territories, and possessions of the United States, Wall Street, East Hampton, Nantucket and the District of Columbia.

HEAR YE, HEAR YE, HEAR YE, may it be known by all thee present, that this TwIRP is hereby declared the law of the land.

The Bailout to End All Bailouts

CHARGE OF THE TARP BRIGADE

(Charge of the Light Brigade, Alfred Lord Tennyson)

(Modified by WilliamBanzai7)


Half a trillion, half a trillion,
Give or take 200 billion, onward!
All in the valley of Balance Sheet Death
Rode the seven hundred billion tax dollars.
"Forward, the TARP Brigade!"
"Charge for the ABS Credit Default Swaps!" Hank said:
Into the valley of Balance Sheet Death
Rode the seven hundred billion taxpayer dollars.


"Forward, the TARP Brigade!"
Was there a politician dismay'd?
Not tho' the Congress knew
Some guy named Hank had blunder'd:
Their's not to make reply,
Their's not to reason why,
Their's but to do and die:
Into the valley of Balance Sheet Death
Rode the seven hundred billion taxpayer dollars.


CDOs to right of them,
CDSs to left of them,
AIG and the GSEs in front of them
Volley'd and thunder'd;
Storm'd at with Wall Street shot and shell,
Boldly that load of Federal largesse rode and well,
Into the jaws of Balance Sheet Death,
Into the mouth of subprime contagion Hell
Rode the seven hundred billion taxpayer dollars.


Flash'd all the workout sabres bare,
Flash'd as they turn'd in air,
Sabring the asset backed losses there,
Charging an army of tawdry bankers, accountants, and shysters, while
All the world wonder'd:
Plunged in the seedy subprime-smoke
Right into the red numbers they broke;
Lehman and Bear Stearns
Spared from the sabre stroke
Shatter'd and sunder'd.
Then they rode back, but not
Not the seven hundred billion.


Subprime CDOs to right of them,
Subprime CDSs to left of them,
Fat Wall Street advisory fees behind them,
Volley'd and thunder'd;
Storm'd at with derivative losses, asset backed shot and shell,
While level 3 zeros fell,
They that had fought so well
Came thro' the jaws of Balance Sheet Death
Back from the mouth of subprime contagion Hell,
All that was left of it?
Nothing left of seven hundred billion buckaroos!


When can its glory fade?
O the wild loss charges!
All the world wondered.
Honor the huge expenditures they made,
Honor the TARP Brigade,
Noble seven hundred billion taxpayer dollars.


(TARP--Troubled Asset Relief Plan of 2008)


williambanzai7.blogspo.../

The Bailout to End All Bailouts

Ballad of Komrad Hank (Gorgy Busz's Kommerce Sekretary)
(Tune of Beverly Hillbillies)

Come and listen to a story about a fine komrad named Hank
A szwanky Goldman banker, who ably kept his partners fed,
Then one day he was laughin at some AIG fools,
And up through the ground came a toxic derivative krude.

CDSs that is, fools gold, Wall Street tea.

Well the first thing you know ol Hank buys billionz of CDOz n szhares,
Taxpayers said "Hank move away from here"
Said Zheleznodorozhny is the place you ought to be"
So he loaded up the junk and shipped it overseas (to Moscow that is).

Szwimming pools, Oligarchs , and everything.

Well now its time to say good by to Hank and all his bailout kin.
And they would like to thank you kapitalist fools fer kindly droppin in.
You're all invited back again to this socialist locality
To have a heapin helpin of state hospitality
Set a spell, Take your white shoes off.

Do swidania, y'hear?.
williambanzai7.blogspo.../

Short Selling Ban Welcome

How The Grinch Almost Killed Wall Street
(How the Grinch Stole Christmas revised by
William Banzai7)
williambanzai7.blogspo.../

Every Banker down on Wall Street Liked CDOS a lot...
But the Grinch,Who lived just north in Greenwich, Did NOT!
The Grinch hated those investment bankers for a whole list of reasons!
Now, that is why we are having this exciting fall season.
It could be his trader head was screwed on just right.
It could be, perhaps, that his white shoes were a little too tight.
But I think that the most likely reason of all,
May have been that his NAV was 12 sizes too small.
Whatever the reason, His smarts or his shoes,
He stood there last week, hating all Wall Street's Whose Whos,
Staring down at his trading P&L with a sour, Grinchy frown,
Detesting those warm lighted screens in Wall Street town.
For he knew every Captain down in Wall Street beneath,
Was busy now, trying to sail through the great Subprime reef.
"And they're firing their traders" he snarled with a sneer,
"In three months its Christmas! It's practically here!"
Then he growled, with his Grinch fingers nervously drumming,
"I MUST find some way to give those investment bankers a drubbing!"
For Tomorrow, he knew, all the Whose Who of Bankers,
Would wake bright and early. And rush to save all their bonus earnings!
And then! Oh, the noise! Oh, the Noise!
Noise! Noise! Noise!
That's one thing he hated! The NOISE!
NOISE! NOISE! NOISE!
Then the Whose Whos, young and old, would all fly Far East.
And they'd try to talk Korea and China into feasting on trading book yeast!
And they'd feast! And they'd FEAST!
FEAST! FEAST! FEAST!
They would feast on champagne and rare banker roast beast.
Which was something the Grinch couldn't stand in the least!
And THEN They'd do something He liked least of all!
Every Who down in Wall Street, the Bulls and the Bears,
Would stand close together, with opening bells ringing.
They'd stand hand-in-hand. And the Whos would start singing!
They'd sing! And they'd sing! And they'd SING!
SING! SING! SING!
And the more the Grinch thought of this Singing,
The more the Grinch thought, "I must stop this whole thing!"
"Why, for year after year I've put up with it now!"
"I MUST stop a Wall Street bailout from coming! But HOW?"
Then he got an idea! An awful idea!
THE GRINCH GOT A WONDERFUL, AWFUL IDEA!
"I know just what to do!" The Grinch laughed in his throat.
And he made a some quick calls to spread rumours of a giant toxic CDS boat.
And he chuckled, and clucked, "What a great short seller trick!"
"With this phone and this screen, I'll batter those Wall Streetwalkers selling asset backed tricks"

"PoohPooh to the Whose Whos!" he was grinchishly humming.
"They're finding out now that no Chinese White Knight is coming!"
"They're just waking up! I know just what they'll do!"
"Their mouths will hang open a minute or two,
Then the Whose Whos down in Wall Street will all cry BooHoo!"
"That's a noise," grinned the Grinch, "That I simply MUST hear!"
So he paused. And the Grinch put his hand to his ear.
And he did hear noises over the trading screen glow.
It started low. Then it started to grow.
But the sound wasn't sad! Why, this sound sounded merry!
It couldn't be so! But it WAS merry! VERY!
He stared down at Bloomberg and Reuters! The Grinch popped his eyes!
Then he shook! What he saw was a shocking surprise!
Every banker down in Wall Street, the Bulls and the Bears,
Was singing! Without any White Knight at all!
He HADN'T seen a Big Federal bailout coming! IT CAME!
Somehow or other, it came!
And the Grinch, stood puzzling and puzzling: "How could it be so?"
"It came with out tickers! It came without a tab!"
"It came as Federal largesse in boxes and bags!"
And he puzzled three hours, till his puzzler was sore.
Then the Grinch thought of something he hadn't before!
"Maybe a Bailout," he thought, "is not just for financial Whooers"
"Maybe Fed bailout...perhaps...me... a little bit more!"
And what happened then? Well...on Greenwich Main Street they say,
That the Grinch's taxes grew 12 sizes that day!
And the minute his wallet didn't feel quite so tight,
He whizzed with his Lexus through the South Bronx morning light,
And he met those Wall Street boys for a Smith & Wolensky feast!
And he, HE HIMSELF! The Grinch carved the beef!

Short Selling: Myths and Facts

How The Grinch Almost Killed Wall Street
(How the Grinch Stole Christmas revised by
William Banzai7)
williambanzai7.blogspo.../

Every Banker down on Wall Street Liked CDOS a lot...
But the Grinch,Who lived just north in Greenwich, Did NOT!
The Grinch hated those investment bankers for a whole list of reasons!
Now, that is why we are having this exciting fall season.
It could be his trader head was screwed on just right.
It could be, perhaps, that his white shoes were a little too tight.
But I think that the most likely reason of all,
May have been that his NAV was 12 sizes too small.
Whatever the reason, His smarts or his shoes,
He stood there last week, hating all Wall Street's Whose Whos,
Staring down at his trading P&L with a sour, Grinchy frown,
Detesting those warm lighted screens in Wall Street town.
For he knew every Captain down in Wall Street beneath,
Was busy now, trying to sail through the great Subprime reef.
"And they're firing their traders" he snarled with a sneer,
"In three months its Christmas! It's practically here!"
Then he growled, with his Grinch fingers nervously drumming,
"I MUST find some way to give those investment bankers a drubbing!"
For Tomorrow, he knew, all the Whose Who of Bankers,
Would wake bright and early. And rush to save all their bonus earnings!
And then! Oh, the noise! Oh, the Noise!
Noise! Noise! Noise!
That's one thing he hated! The NOISE!
NOISE! NOISE! NOISE!
Then the Whose Whos, young and old, would all fly Far East.
And they'd try to talk Korea and China into feasting on trading book yeast!
And they'd feast! And they'd FEAST!
FEAST! FEAST! FEAST!
They would feast on champagne and rare banker roast beast.
Which was something the Grinch couldn't stand in the least!
And THEN They'd do something He liked least of all!
Every Who down in Wall Street, the Bulls and the Bears,
Would stand close together, with opening bells ringing.
They'd stand hand-in-hand. And the Whos would start singing!
They'd sing! And they'd sing! And they'd SING!
SING! SING! SING!
And the more the Grinch thought of this Singing,
The more the Grinch thought, "I must stop this whole thing!"
"Why, for year after year I've put up with it now!"
"I MUST stop a Wall Street bailout from coming! But HOW?"
Then he got an idea! An awful idea!
THE GRINCH GOT A WONDERFUL, AWFUL IDEA!
"I know just what to do!" The Grinch laughed in his throat.
And he made a some quick calls to spread rumours of a giant toxic CDS boat.
And he chuckled, and clucked, "What a great short seller trick!"
"With this phone and this screen, I'll batter those Wall Streetwalkers selling asset backed tricks"

"PoohPooh to the Whose Whos!" he was grinchishly humming.
"They're finding out now that no Chinese White Knight is coming!"
"They're just waking up! I know just what they'll do!"
"Their mouths will hang open a minute or two,
Then the Whose Whos down in Wall Street will all cry BooHoo!"
"That's a noise," grinned the Grinch, "That I simply MUST hear!"
So he paused. And the Grinch put his hand to his ear.
And he did hear noises over the trading screen glow.
It started low. Then it started to grow.
But the sound wasn't sad! Why, this sound sounded merry!
It couldn't be so! But it WAS merry! VERY!
He stared down at Bloomberg and Reuters! The Grinch popped his eyes!
Then he shook! What he saw was a shocking surprise!
Every banker down in Wall Street, the Bulls and the Bears,
Was singing! Without any White Knight at all!
He HADN'T seen a Big Federal bailout coming! IT CAME!
Somehow or other, it came!
And the Grinch, stood puzzling and puzzling: "How could it be so?"
"It came with out tickers! It came without a tab!"
"It came as Federal largesse in boxes and bags!"
And he puzzled three hours, till his puzzler was sore.
Then the Grinch thought of something he hadn't before!
"Maybe a Bailout," he thought, "is not just for financial Whooers"
"Maybe Fed bailout...perhaps...me... a little bit more!"
And what happened then? Well...on Greenwich Main Street they say,
That the Grinch's taxes grew 12 sizes that day!
And the minute his wallet didn't feel quite so tight,
He whizzed with his Lexus through the South Bronx morning light,
And he met those Wall Street boys for a Smith & Wolensky feast!
And he, HE HIMSELF! The Grinch carved the beef!

Causes and Opportunity Cost on the Ongoing Crisis

Paulsens's Big Rock Candy Mountains

(to the melody of Big Rock Candy Mountain)
Lyrics By WilliamBanzai7


One evening as the DOW went down and the ABX was burning
Down the track came a banker hiking and he said boys I'm not turning
I'm headin for a land that's far away from Wall Street's crystal towers
So come with me we'll go and see the Bernanke's Big Rock Candy Mountains

In Bernanke's Big Rock Candy Mountains there's a land that's fair and bright
Where the handouts grow from the Bush bailout pros and you sleep sound every night
Where the ABS books are all empty and the sun shines every day
On the birds and the bees and the bonus trees
Where the perrier springs where the squawk box sings
In the Paulsen's Big Rock Candy Mountains

In Paulsen's Big Rock Candy Mountains all the regulators have wooden legs
And the shorts all have rubber teeth and the taxpayers lay golden eggs
The traders books are full of fruit and the bankers play all day
Oh, I'm bound to go where there ain't no snow
Where the rain don't fall and the wind don't blow
In Paulsen's Big Rock Candy Mountains

In Paulsen's Big Rock Candy Mountains you never sell your stocks
And the glimmering streams of origination fees come a-trickling down the rocks
The enforcers have to tip their hats and the bears and shorts are banned
There's a lake of stew and of champagne too
You can sail all around 'em in your custom yachts
In Paulsen's Big Rock Candy Mountains

In Paulsen's Rock Candy Mountains white collar jails are made of tin
And you can walk right out again as soon as you are in
There ain't no short handled shovels, no axes saws or picks
I'm a goin to stay where you sleep all day
Where they hung that jerk from Berkshire Hathaway
In Paulsen's Big Rock Candy Mountains

I'll see you all this coming fall in Paulsen's Big Rock Candy Mountains

The Bailout to End All Bailouts

The Great Subprime “Babel”—A Modern Tale of Biblical Greed

By WilliamBanzai7

Wall Street never changes. The pockets change, the suckers change, the stocks change, but Wall Street never changes because human nature never changes. - Jesse Livermore

The public’s annual loss to Wall Street has usually been estimated in former years at $100,000,000 per annum, but owing to the more recent enterprising methods of the “Street” in manipulating the game, this estimate is now far to small as we shall see.-Franklin Keyes (1904)

Conceit of the Street

Shortly after the explosion of the great “dot.com” bubble something happened that was to change the monetary affairs of all men on Earth.
The investment banking tribes had once again begun to proliferate and fill the Street. They spoke a new tongue--the tongue of rampant financial innovation. It was a strange tongue with words like synthetic CDOs, conduiting, CLOs, SIVs, bespoke swaps, CDOs squared, negative default correlations, binomial expansions and stochastic modeling. A tongue curiously reminiscent of the tongue of the House of ENRON.

The generations of bankers before the “dot.com” bubble, were believers in the fundamental laws of securities valuation and diversification. They were believers in the book of Graham and Dodd.

But the new generation of investment bankers was different. They stressed an opposite code of investing. The smart investor did not count. Their game was a vast pyramid of derivatives and mortgage backed securities. Had they confined themselves to this kind of financial life in a modest fashion, all might have been well. But the obscene fee income made possible by cheap leverage, financial engineering and securitization techniques made them ever greedier and in their hubris they thought they could beat the financial laws of thermodynamics.

They decided to build a great Tower of mortgage backed securities. With the Tower they would pillage the housing markets and at the same time seemingly eliminate all risk for themselves. Heads we win, tails you lose; that was their credo. The symbol of their invincible wealth, as they thought, was to be built in the shadow of the House of Greenspan. It would be squeezed out of Joe Public who was long disdained and exploited by the Lords of the Street. This time they would build tempt Joe with reckless mortgage loans supported by an “irrationally exuberant” real estate market.

According to the Lords of the Street, a new paradigm had emerged: financial risk could be sliced and diced into oblivion, cheap leverage is here to stay and housing prices can only go up. Many foresaw the folly of this enterprise. Buffet, the great chief of the House of Berkshire Hathaway, called the new instruments of invincible wealth, financial weapons of mass destruction. But the aging House of Greenspan was oblivious to the great folly unfolding before its jaundiced eye. The unbelievers were admonished to stay in Nebraska where they belonged.


Their Punishment

Finally, the Market decided to punish the arrogance of the bankers by destroying the tower. First, it, confused them by splitting them up into many greedy tribes, each with a tongue and agenda of its own, (hence the name Babel, meaning “confusion”). A new tribe, the Shorts, arrived and the hunters soon became the hunted. Alas, they were forced to subjugate their vast pools of CDOs and CDSs to the divine force of the Market. This ultimate humiliation came to be known as the “great MTM slaughter.”

When this happened, the Tower had to be abandoned. The various bankers would migrate in different directions. Many were fired. Others headed West to the Valley of Silicon, no doubt dreaming of other Babels ripe for exploitation—nanotech, infotech, biotech and cleantech to name but a few .

The Tower itself was partly burned and partly swallowed by the great Houses of Morgan, Barclay’s and BOA. As for the Great Houses of Goldman and Morgan, they were forced to pledge themselves to the Fed, under the wise and benevolent protection of Gentle Ben, the new master of the House of Greenspan. He who would later come to be known as “Father Moral Hazard”.


(Adapted by WilliamBanzai7 from the Biblical story of the Tower of Babel)

The Bailout to End All Bailouts

2 Big 2 Fail = 2 Stupid 2 Survive

The Fed Giveth, the Fed Taketh Away

Bernanke's Big Rock Candy Mountains

(to the melody of Big Rock Candy Mountain)
Lyrics By WilliamBanzai7


One evening as the DOW went down and the ABX was burning
Down the track came a banker hiking and he said boys I'm not turning
I'm headin for a land that's far away from Wall Street's crystal towers
So come with me we'll go and see the Bernanke's Big Rock Candy Mountains

In Bernanke's Big Rock Candy Mountains there's a land that's fair and bright
Where the handouts grow from the Bush bailout pros and you sleep sound every night
Where the ABS books are all empty and the sun shines every day
On the birds and the bees and the bonus trees
Where the perrier springs where the squawk box sings
In the Bernanke's Big Rock Candy Mountains

In Bernanke's Big Rock Candy Mountains all the regulators have wooden legs
And the shorts all have rubber teeth and the taxpayers lay golden eggs
The traders books are full of fruit and the bankers play all day
Oh, I'm bound to go where there ain't no snow
Where the rain don't fall and the wind don't blow
In Bernanke's Big Rock Candy Mountains

In Bernanke's Big Rock Candy Mountains you never sell your stocks
And the glimmering streams of origination fees come a-trickling down the rocks
The enforcers have to tip their hats and the bears and shorts are banned
There's a lake of stew and of champagne too
You can sail all around 'em in your custom yachts
In Bernankies Big Rock Candy Mountains

In Bernanke's Rock Candy Mountains white collar jails are made of tin
And you can walk right out again as soon as you are in
There ain't no short handled shovels, no axes saws or picks
I'm a goin to stay where you sleep all day
Where they hung that jerk from Berkshire Hathaway
In Bernanke's Big Rock Candy Mountains

I'll see you all this coming fall in Bernanke's Big Rock Candy Mountains

Lessons to Learn from the Market Meltdown

Sympathy for the Devil
(Lyrics by WilliamBanzai7)

Please allow me to introduce myself
Im a man of wealth and taste
Ive been around for a long, long year
Stole many a mans nest egg and faith
And I was round when Livermore
Had his moment of doubt and pain
Made damn sure that Milken
Washed his hands and sealed his fate
Pleased to meet you
Hope you guess my name
But whats puzzling you
Is the nature of my game
I stuck around AIG
When I saw it was a time for a change
Fired the CEO and his SVPs
While Bernanke screamed in vain
I owned a bank
Was best friends with Hank
When the markets raged
And the cold Pizzas stank
Pleased to meet you
Hope you guess my name, oh yeah
Ah, whats puzzling you
Is the nature of my game, oh yeah
I watched with glee
While your investment banks bleed
Fought for ten decades
For the junk paper they made
I shouted out,
Who killed LTCM and the SEC?
When after all
It was you and me
Let me please introduce myself
Im a man of wealth and taste
And I laid traps for bond traders
Who get fired before they reach Mumbai
Pleased to meet you
Hope you guessed my name, oh yeah
But whats puzzling you
Is the nature of my game, oh yeah, get down, baby
Pleased to meet you
Hope you guessed my name, oh yeah
But whats confusing you
Is just the nature of my game
Just as every banker is a criminal
And all the investors saints
As heads is tails
Just call me Merrill, Bear, Drexel, Lehman, Kidder & Chase
cause Im in need of some restraint
So if you meet me
Have some courtesy
Have some sympathy, and some taste
Use all your well-learned risk controls
Or Ill lay your trading book to waste, um yeah
Pleased to meet you
Hope you guessed my name, um yeah
But whats puzzling you
Is the nature of my game, um mean it, get down
Woo, who
Oh yeah, get on down
Oh yeah
Oh yeah!
Tell me baby, whats my name

AIG and the Derivative Nightmare

CDSs are the new Ponzi scheme. I challenge anyone to argue otherwise. Unfunded surety arrangements for a fee. Hedgefund heaven.

AIG: America's Insurance Giant

"The Markets They Are A-Changin'"
(to the melody by Bob Dylan)

Come gather round 'bankers'
Wherever you roam
And admit that the waters
Around you have grown
And accept it that soon
You'll be told to go home
If your job to you
Is worth savin'
Then you better start swimmin'
Or you'll sink like the DOW
For the markets they are a-changin'.

Come hedgefunds and bear traders
Who prophesize and sell short
And keep your eyes wide
The chance won't come again
And don't speak too soon
For the markets still in spin
And there's no tellin' who
That it's namin'
For the markets they are a-changin'.

Come senators, congressmen
Please heed the call
Don't stand in the doorway
Don't block up the hall
For he that gets hurt
Will be he who has stalled
There's financial meltdown outside
And it is ragin'
It'll soon shake your windows
And rattle your walls
For the markets they are a-changin'.

Come Central Bankers
Throughout the land
And don't criticize
What you can't understand
Those derivative books
Are beyond your command
The old road is
Rapidly agin'
Please get out Bernanke and Paulsen
If you must bail them out out
For the markets they are a-changin'.

The AIG Rescue: Can Bailout Capitalism Work?

"The Markets They Are A-Changin'"
(to the melody by Bob Dylan)

Come gather round 'bankers'
Wherever you roam
And admit that the waters
Around you have grown
And accept it that soon
You'll be told to go home
If your job to you
Is worth savin'
Then you better start swimmin'
Or you'll sink like the DOW
For the markets they are a-changin'.

Come hedgefunds and bear traders
Who prophesize and sell short
And keep your eyes wide
The chance won't come again
And don't speak too soon
For the markets still in spin
And there's no tellin' who
That it's namin'
For the markets they are a-changin'.

Come senators, congressmen
Please heed the call
Don't stand in the doorway
Don't block up the hall
For he that gets hurt
Will be he who has stalled
There's financial meltdown outside
And it is ragin'
It'll soon shake your windows
And rattle your walls
For the markets they are a-changin'.

Come Central Bankers
Throughout the land
And don't criticize
What you can't understand
Those derivative books
Are beyond your command
The old road is
Rapidly agin'
Please get out Bernanke and Paulsen
If you must bail them out out
For the markets they are a-changin'.